ON THE NIGHT CHICAGO BURNED, A STORM OF FIRE CONSUMED PESHTIGO,

Jay Clarke, Knight-Ridder News ServiceCHICAGO TRIBUNE

Everybody has heard how Mrs. O`Leary`s cow kicked over a lantern and started the Great Chicago Fire that killed 250 people. But few are aware that on that very same day--Oct. 8, 1871--another fire in a town 250 miles north of Chicago claimed four times as many victims.

In Peshtigo, they still call it the Great Fire. It wiped out the town, killed at least 800 people (some estimates go as high as 1,200) and is considered the most lethal forest fire in American history.

Yet the event is almost totally forgotten. The news media concentrated on the Chicago disaster and virtually ignored the much larger tragedy in Peshtigo, then a thriving lumbering and manufacturing town.

Moreover, it was no ordinary forest fire that engulfed Peshtigo. It was a rarely seen ''tornado of fire.''

The conflagration moved with astonishing rapidity. Powerful winds drove clouds of flame above and ahead of the main line of ground fire. Flaming tops of trees were torn away to fly through the sky like shooting stars. Black billows of unignited gases swirled over the town, then suddenly exploded to rain hellish fire on the terrified populace. Buildings didn`t simply catch fire; they exploded.

Peshtigo was the home of the biggest wooden ware factory in the country, four stories high and more than 430 feet long. When it exploded that night,

''burning toothpicks, broom handles and wooden tubs went flying through the air. It was like a giant fireworks display,'' one survivor, Amanda Stuart, told her granddaughter, Fay S. Dooley.

With few exceptions, the only survivors were those who jumped into the Peshtigo River that bisects the town. Dooley, who now lives in nearby Marinette, said her grandmother told her that as she ran toward the river, a burning double-width door from a boarding home flew off and just missed her husband, singeing his red beard.

''She stayed in the river all night, using her hat to pour water over her and her baby,'' said Dooley. ''You had to or you would catch fire.''

So virulent was the fire storm that it leaped 18 miles of Green Bay waters to ravage parts of the Door Peninsula, which today is one of the Midwest`s great tourist destinations. When the fire finally let up near dawn, Peshtigo was a smoldering ruin--homes, businesses and factories destroyed, hundreds of people burned beyond recognition. Only one home--partially built at the time--survived the fire. It still stands.

Driving through Peshtigo today, travelers would never know it had suffered such a calamity. With typical small-town pride, Peshtigo (population 2,900) calls itself the ''Busiest Small City in America'' and boasts that

''the wrapper around your next stick of gum, tax insurance form or test paper'' may have come from this community.

Timber products still are Peshtigo`s biggest industries, as they were before the Great Fire. Badger Paper Mills` factory sprawls along the Peshtigo River in the heart of town. Packerland Woodworking Corp. manufactures custom, commercial and institutional furniture in a huge plant. The town also produces sausage casings, molds and dies, cutting tools and conducts livestock sales, among other businesses.

Peshtigo is not really a tourist destination, just a stop on the main highway between the city of Green Bay, Wis., and the ports and resorts of Upper Michigan. But there are regular sightseeing boat tours upstream on the winding Peshtigo River that are particularly attractive in autumn, and many tourists stop to see Peshtigo`s Fire Museum.

Occupying the former church, the museum has three large murals depicting life before, during and after the great fire. It also has a collection of objects relating to the conflagration: charred timbers, a chest saved from the ruins, melted coins and buckles, old newspapers and the like.

Here you learn in more detail what happened that fateful day 114 years ago.

The summer of 1871 had been extraordinarily dry. For weeks, small fires smoldered under the fallen leaves in the white pine forests north of Peshtigo, flaring up when the wind strengthened. Only a week before the Great Fire, the men of the town had turned out to fight a heavy fire near the wooden ware factory.

On Oct. 8, the air was hot and there was smoke in the air. At twilight, residents could see a dull red glow over the trees in the southwest. The glow brightened to crimson and a far-off murmuring sound, like a freight train in the distance, became audible.

In less than five minutes, the murmur became a roar and was accompanied by terrible crashings and deep booms. The sky turned cherry red, and suddenly there was fire everywhere.

The pine sidewalks burst into flame. Frantic residents fled for their lives. Some ran to the bridge over the river, but it caught fire and collapsed, burning and drowning hundreds. More than 70 people sought refuge in the lumber company`s boarding house, a sturdy building. It exploded. Others died in mid-step, seared by blasts of furnace-hot air.

In one hour, between 9 and 10 p.m., Peshtigo was obliterated.

It was several weeks before the newspapers, whose columns had been filled with the Chicago disaster, got around to writing about Peshtigo. The governor of Wisconsin, in fact, had to issue a special proclamation to plead with residents to divert their gifts from Chicago to Peshtigo.

On the ashes of the blackened town, the citizens of Peshtigo rebuilt their city. A new church was constructed and beside it were buried many of the fire`s victims, including more than 300, burned beyond recognition, in a mass grave. They are there today.

Wander through the well-kept cemetery and you cannot help but be touched by the poignant incriptions. One white headstone of the McGregor family seems to say it all: